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E
C ONOM IC R
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7
3. Economic Contribution
In Sum
m ar
y
O
il and gas is the dominant Ĩuel Ɖoǁering our economy, our
transƉort netǁorŬ and our heating systems, Ɖroǀiding oǀer
t
h
r
e
e q uar
t
e
r s of t
h
e t ot al e ne
r gy m ix in t
h
e UK. A
r ound
6 0 p
e
r ce nt of t
h is com
e s fr om indige nous r
e sour ce s. Ov
e
r t
h
e ne
x
t
20 years, reneǁaďles caƉacity ǁill groǁ Ɖrimarily Ĩor electricity
generation, ďut not ƋuicŬly enough to disƉlace Ĩossil Ĩuels͘ Oil and gas
is still edžƉected to comƉrise tǁoͲthirds oĨ the energy midž in 20ϯϱ͘ It
w ill r
e
m ain p ar
t of a div
e
r se m ix of fue ls t
h at is r
e
q uir
e d t o e nsur
e an
aīordaďle and secure Ĩuture energy suƉƉly ǁhile achieǀing emissions
reduction targets͘
The ďeneĮts oĨ meeting domestic oil and gas demand Ĩrom indigenous
sources oĨ Ɖroduction are ǁidesƉread͘ The UK ontinental ^helĨ͛s
;UK ^Ϳ resources are critical to security oĨ energy suƉƉly to minimise
imƉort deƉendencies͘ tithout domestic Ɖroduction, the UK ǁould
h av
e h ad t o im
p or
t £ 17 b illion w or
t
h of oil and gas last y
e ar t o m
e
e
t
demand, ǁhich ǁould haǀe increased the UKΖs ďalance oĨ trade deĮcit
b
y alm ost 5 0 p
e
r ce nt .
The industry also currently suƉƉorts oǀer ϯ00,000 ũoďs in the UK͘
Although this is around ϯϱ Ɖer cent ďeloǁ the ƉeaŬ in 201ϰ, the leǀel
of e
m
p loy
m
e nt is e
x
p
e ct
e d t o st ab ilise ov
e
r t
h
e r
e st of t
h
e de cade if
actiǀity ďegins to ƉicŬ uƉ͘ esƉite most oĨ the UK͛s reserǀes lying oī
the coast oĨ ^cotland, the ǀalue generated Ĩrom the industry is sƉread
across the entire country͘ The diǀerse and highly sŬilled suƉƉly chain
anchored here also acts as an edžƉort huď, generating almost
£ 12 b illion w or
t
h of r
e
v
e nue last y
e ar fr om se
r
v icing ov
e
r se as b asins.
&urthermore, the sector can helƉ the UK achieǀe its climate change
targets͘ Eatural gas is an aīordaďle, reliaďle, relatiǀely loǁerͲcarďon
Ĩuel that can Įll reneǁaďle energy intermiƩency gaƉs͘ It has already
helƉed the UK achieǀe signiĮcant emissions reductions in Ɖoǁer
generation ďy disƉlacing highly carďonͲintensiǀe Ĩuels such as coal͘ A
reduction in emissions released during the Ɖroduction oĨ oil and gas
is a sign of t
h
e indust
r
y
’ s com
m it
m
e nt t o it s ow n sust ainab ilit
y and
madžimising domestic Ɖroduction ǁill reduce reliance on Ĩuel imƉorts
t
h at can b
e m or
e car
b on int
e nsiv
e .
E
C
M
C
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E conomic R eport 2 017
- F acts and F igures
sets out aspirations
for the industry
The average
Brent oil price was
30%
higher over the first half
of this year than the
same period last year
The UK Government
forecasts that
of the UK’s energy mix
will still come from oil
and gas by 2035
2
/
3
E conomic R eport 2 017
- F acts and F igures
The oil and gas industry
supports over
The average
Brent oil price was
30%
higher over the first half
of this year than the
same period last year
The UK Government
forecasts that
of the UK’s energy mix
will still c me from oil
and gas by 2035
The average NBP
day-ahead gas price was
over the first half of
2017 than the same
period last year
300,000 jobs
in the UK
2
/
3
40%
higher
omic R eport 2 017
nd F igures
The oil and gas industry
supports over
The cost of industry
The average
The UK Government
forecasts that
of the UK’s energy mix
w ll still come from oil
and gas by 2035
The average NBP
Every £1 million of
industry expenditure
sustained around
17 jobs across the UK
economy last year
300,000 jobs
in the UK
2
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3